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JUDGMENT Dr. Satish Chandra, J. - The present appeal is filed by the department under Section-260-A of the Income Tax Act against the judgment and order dated 16.01.2001, passed by the Income Tax Appellate Tribunal, Delhi in Appeal No.6408 of 1993 for the assessment year 1990-91. 2. On 17.03.2010, the appeal is admitted by a Co-ordinate Bench on the following substantial questions of law:- "(a) Whether on the facts and in the circumstances of the case the Tribunal has erred in law in allowing the deduction of Rs. 17,10,011/- on account of provision for interest as it is a fictional liability?" 3. The brief facts of the case are that the assessee is a limited company deriving the income from manufacturing and sale of sugar and I.M.F.L. During the assessment year under consideration, the assessee has exported the country sprit, I.M.F.L. to Delhi. The excise duty was payable on these items as per the U.P. Excise Act. The assessee has not paid the duty payable to the government on export the goods outside the U.P. The A.O. opined that assessee is liable to pay the interest too. Like previous years, the assessee has debited the duty and interest in the profit & loss account to claim the benefit under Section-43B of the Act. The amount of Rs. 17,10,011/- on account of interest was claimed as deduction under Section-43B of the Income Tax Act, but the same was not allowed by the A.O., the First Appellate authority as well as the Tribunal have allowed the claim. Being aggrieved, the department has filed the present appeal. 4. With this background, Sri R.K. Upadhya, learned counsel for the department has justified the order passed by the A.O. and submits that the demand of the export duty was assailed before the Hon'ble High Court where the assessee has lost the case. The assessee has assailed the same before Hon'ble Apex Court. The fate of the said case pending before Hon'ble Apex Court is not known, but there is no interim order passed by Hon'ble Supreme Court. To justify his submission, he relied on the ratio laid down in the case of CIT v. Kesar Sugar Works Ltd. [1999] 239 ITR 398/107 Taxman 226 (Bom.), wherein it was observed that:- "We have carefully considered…

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